Lions reportedly restructure Tracy Walker's contract to add cap space

Allen Park — The Detroit Lions have freed up $5 million in cap space by restructuring safety Tracy Walker's contract, according to ESPN.

These moves are common throughout the NFL and a restructure doesn't mean a pay deduction. In fact, players typically welcome restructures because it converts a significant portion of their base salary into a bonus, giving them that money immediately. It also adds more dead money to the end of their deal, providing some added security by decreasing the value of cutting the player in the future.

The typical restructure follows a simple formula: A portion of the player's salary is converted to a bonus, and that money, for cap purposes, is spread evenly across the remaining years on the contract.

For example, for a player scheduled to have a $4 million salary in 2023 with three years remaining on their contract, if a team converted $3 million to a bonus, reducing the 2023 salary to $1 million, that $3 million would be divided evenly for the three years remaining on the contract, or $1 million per season.

That prorated portion would then be added to the base salary to get the new cap figure. In this example, it would be the new base salary of $1 million, plus the prorated portion of the restructure bonus, another $1 million, for a $2 million cap hit. So if the previous cap hit was the $4 million salary, the team created $2 million in cap space to spend in 2023.

Now, it's important to note that $2 million didn't disappear. It was pushed down the road, increasing the player's cap hit by $1 million in both 2024 and 2025, the remaining two years on the hypothetical contract.

Walker's case is a bit more tricky. He entered the week with two years remaining on his deal and an $11.32 million cap hit in 2023. With a base salary of $8.95 million, there is no way to create $5 million in space with a simple restructure. To do so, the Lions would have to introduce a voidable year to the end of his contract.

Voidable years are not new, but they've been an increasingly used cap mechanism in recent years. For example, the Lions signed DJ Chark to a one-year, $10 million contract last season, but in reality, it was a three-year deal with two voidable years. With nearly $9 million of that money coming as a signing bonus, it allowed the Lions spread out the hit, so only $4 million counted against the cap last year. That means no matter where Chark plays in 2024, the Lions will carry a lingering $6 million cap hit from last year's contract.

For Walker, to create the reported $5 million in space, the Lions would have to add a voidable year and convert $7.5 million of his base salary to a bonus, spreading that amount evenly across this season, next season and the new, voidable year in 2025.

That reduces Walker's cap hit to $6.32 million this season, but increases the 2024 figure from $10.32 million to $12.82 million. Additionally, the team will now be on the hook for a $2.5 million cap hit in 2025, after his contract expires. Even if he ultimately re-signs with Detroit, that $2.5 million will continue to count against the cap in addition to his new contract figures.

An added benefit for the player is a restructure can add security. Before the restructure, Walker's contract only had $2.32 million in dead money in 2024. That means the team could have cut him next offseason and saved $8 million in cap space. Now, the deal will carry $7.32 million in dead money, only offering $5.5 million in savings if a cut is considered. The decision now makes less financial sense for the team.

jdrogers@detroitnews.com

Twitter: @Justin_Rogers